A continuing issue for ALA in the past few years relates to licensing. License agreements, rather than outright sales, have become an accepted and prevalent means for publishers to provide their products to libraries. And although licensing has proven to be a convenient way to obtain journals, for example, license terms can expand -- or restrict -- the uses of a work that would have been allowed under the copyright law. Some people even ask, "Is copyright dead?" That is, does increased use of licensing of information make copyright law irrelevant?

In order to help librarians deal with the myriad license issues that confront them, many institutions and library associations regularly offer workshops and courses on negotiating license agreements. Legal counsel and contracting officers at libraries and educational institutions also find it prudent to develop an expertise on licensing digital library materials. Unique issues for libraries may include what can – and cannot be done – with regard to archiving, long-term access, copying by users, off-premises access, micro-data pricing, and interlibrary loan.

Shrink-wrap and click-on license agreements

Another related area of concern relates to terms in shrink-wrap and click-on license agreements that are unfairly written in favor of licensors. Such terms in these licenses often diverge substantially from reasonable customer expectations and from the public interest. The terms may override what libraries are otherwise allowed to do under U.S. copyright law. The license terms may require that a library “agree” to sue or be used in a distant court in the event of a contractual dispute. Yet there often is no opportunity to negotiate or change the terms. Numerous organizations are working to highlight isseus associated with these kinds of end-user license agreements ("EULAs"). See Resources below.

UCITA vs. fair terms

ALA worked successfully for five years to fight the enactment by state legislatures of the Uniform Computer Information Transactions Act (UCITA). Although UCITA is still a Uniform Law, its sponsor, the National Conference of Commissioners on Uniform State Laws (NCCUSL) has publicly stated that it will not expend its resources to promote the adoption of UCITA by other states (Maryland and Virginia alone passed versions of UCITA). AFFECT, the anti-UCITA coalition that ALA helped to found and continues to lead, has published its 12 Principles for Fair Commerce in Software and Other Digital Products. Included in The Principles are that users should be:

entitled to readily find, review and understand proposed terms when they shop.

entitled to actively accept proposed terms before they make the deal.

entitled to fair use, including library or classroom use, of digital products to the extent permitted by federal copyright law.

entitled to have their disputes settled in a local, convenient venue.

entitled to study how a product works.

entitled to express opinions about products and report their experiences with them

Federal copyright law and license agreements

Although the law governing contracts ordinarily is state law rather than federal, legislation has been introduced in recent years in the US Congress to address these concerns. In the 108th Congress, for example, Representative Zoe Lofgren (D-CA) introduced H.R. 1066, which provided that when a digital work (such as software or music) is made available generally to the public “subject to nonnegotiable license terms,” such terms would not be enforceable under state laws to the extent that the terms restricted or limited provisions in the US Copyright Act such as fair use. At present, however, the Copyright Act provides that the federal copyright law does not affect “any contractual obligations assumed at any time by the library or archives when it obtained a copy or phonorecord of a work in its collections.” 17 U.S.C. Sec. 108(f)(4).

International Issues

In the meantime, the issue of “choice of court” terms in license agreements was the subject of intense negotiations on the international scene. The Hague Convention on Choice of Court Agreements is a multilateral agreement that creates rules for determining jurisdiction in international lawsuits and provides for recognizing and enforcing judgments by the courts of the Member States (including the US).

The Convention will make more readily enforceable “choice of court” provisions in contracts (including those governing copyrighted materials, such as software) and the resulting court judgments, in the event that the parties resort to the courts to settle a legal dispute. These terms allow the licensor to designate in advance which court will hear the parties’ disputes. For example, a U.S. library "agrees to" a non-negotiated contract that requires that any litigation about the contract/license must be brought in or defended in a court halfway around the world. There is a dispute over the contract because the licensor fails to provide updates to a popular database, and the library sues in a U.S. court. Should the Convention apply, so that the U.S. court must hold the library to that particular term of the contract and dismiss the case, forcing the library to sue in the foreign court?

To address the concern that the Convention would make these terms more easily enforceable, a number of groups, including libraries and the business community, pressed for an exclusion from the scope of the convention, i.e., an express provision that non-negotiated contracts - such as shrink-wrap and click-on agreements - would not to be covered by the convention.

Ultimately, however, the pressure from software and copyright industries in the US and abroad to include non-negotiated contracts was more effective. As concluded in a diplomatic conference on June 30, 2005 [pdf], the convention contains no such express exclusion. It is unclear as of 2006 whether the U.S. will ratify the treaty so that courts in the US and elsewhere will be obliged to enforce “choice of court” terms regardless of the hardship.